U.S. Steel Corp. is closing another plant, laying off 1,100 workers at a nearly century-old mill in Alabama.
The Pittsburgh-based steelmaker, which founded Gary as a company town and has extensive operations in the region, announced it would permanently close a blast furnace and most of the flat-rolled finishing operations at Fairfield Works in Alabama. U.S. Steel has lost money in five of the last six years, and its flat-rolled segment lost $64 million last quarter.
"We have made some difficult decisions over the last year as part of our portfolio optimization," said U.S. Steel President and CEO Mario Longhi, who received a $7.6 million increase in compensation last year. "We have determined that the permanent shutdown of the Fairfield Works blast furnace, steelmaking and most of the finishing operations is necessary to improve the overall efficiency and cost structure of our flat-rolled segment."
U.S. Steel is still building an electric arc furnace at the mill, which also has tubular operations that will remain open. The electric arc furnace, which can make a lower-grade steel from recycled metal, will produce about 1 million fewer net tons of iron a year, but will be less expensive to operate because it can just be idled and restarted as demand dictates.
Around 400 workers should remain employed at the mill, which now employs around 1,500.
On or after Nov. 17, the steelmaker plans to close the blast furnace, a hot strip mill, the pickle line, cold mill, annealing factory and stretch and temper line. U.S. Steel said it reached the decision after careful market analysis and is trying to ensure its global competitiveness.
Battered by a glut of cheap imports and low prices, U.S. Steel has warned 9,000 of its workers nationally they could be laid off this year. The steelmaker has idled East Chicago Tin and permanently shuttered the coke plant at Gary Works.